Summer 2005

Warning: Don't Be Fooled by Fake Checks

The FDIC wants to remind consumers that fraud artists are using counterfeit cashier's checks, money orders and other checks to trick victims into sending money. Many of these scams involve offers that arrive by mail or e-mail or that are in connection with Internet sales.

"The volume of fake checks reported to the FDIC in the last two years has increased dramatically," said Michael Benardo, manager of the FDIC's Financial Crimes Section. "The increase is due in part to crooks using advanced copying and printing technologies to produce authentic-looking counterfeit documents."

Here are examples of common scams:

In these examples, if you deposit or cash the check or money order it likely will not "clear"(be paid) when it is sent to the bank on which it is supposed to be drawn. And, the fraudulent check will likely be returned to your bank and charged against your account. Depending on the circumstances and your state's laws, you may be held responsible for the entire amount of the fraudulent check.

In general, be very suspicious of offers that seem too good to be true. "Be smart and don't be tempted," said Benardo. "Stop and ask yourself, 'Why would someone I never met contact me for help getting money out of a foreign country? 'Why would a stranger send me a big check for no apparent reason?'"

When in doubt, Benardo added, "it's usually best to walk away from the deal immediately."

For more information about protecting against counterfeit checks, see a special report in the Spring 2003 FDIC Consumer News online at www.fdic.gov/consumers/consumer/news/cnspr03/index.html.